Air Canada has commenced a public offering of
Class A Variable Voting Shares and/or Class B Voting Shares of the
company for gross proceeds of approximately C$500 million and a
concurrent private placement of convertible senior unsecured notes
for gross proceeds of approximately US$400 million.
Air Canada intends to grant the underwriters an
option to purchase up to an additional 15% of the shares in the
Share Offering, exercisable in whole or in part at any time until
30 days after closing of the Share Offering and up to an
additional 15% of the Convertible Notes in the Convertible Notes
Offering, exercisable in whole or in part at any time until 13
days after closing of the Convertible Notes Offering.
The Share Offering will be priced in the context
of the market with the price and other final terms to be
determined at the time of entering into an underwriting agreement
for the Share Offering.
The Convertible Notes will be
senior unsecured obligations of the company and will accrue
interest payable semi-annually in arrears and will mature on 1 July 2025, unless earlier repurchased, redeemed or converted. The
Convertible Notes will be convertible into cash, Class A Variable
Voting Shares and/or Class B Voting Shares of the company or a
combination thereof, at the company’s election. The interest rate,
initial conversion rate and other terms of the Convertible Notes
will be determined at the time of pricing of the Convertible Notes
Completion of the Offerings will be subject to
various conditions, including the approval of the Toronto Stock
Air Canada has stated that it intends to use the net proceeds from
the Offerings to supplement the company’s working capital and
other general corporate purposes.
TD Securities Inc., J.P. Morgan Securities
Canada Inc. and Citigroup Global Markets Canada Inc. are acting as
joint active book-running managers for the Share Offering and J.P.
Morgan Securities LLC, TD Securities Inc. and Citigroup Global
Markets Canada Inc. are acting as joint active book-running
managers for the Convertible Notes Offering.